EXCUTIVE SUMMARY

Our business will operate under the name Nafaka Linker Shop and will be located in Dar es

salaam. It will be operated as a partnership which comprises of five partners who are operators of

the business, the business falls under the category of medium size business as our capital is

above five millions but below forty millions expected to commence on 1st July 2022, with the

mission being to offer the society with high quality, various standard packaging, quick delivery

and affordable prices of whole meal flour and rice, and the vision is to become among the

leading suppliers of cereals in Tanzania by 2030. Our product is of high quality and satisfactory

to the demands of customers in the targeted market, as some of our product comprises of

nutrients emphasized by doctors for good health. Our product will be easy to be obtained by

every customer at a time they require due to availability of our leased warehouse in Dar es

salaam city. The business potential customers will include the dwellers of Dar es salaam city and

other regions in Tanzania, various cafes and food kiosk owners. The business is also going to

face various competitors though the biggest competitor is Bakhresa . Due to rapid increase in

demand for whole meal flour and rice, many people find themselves in need of our product. In

one way or another people will need some sort of quick delivery and reliable availability of the

products we are supplying. We target to serve small sized whole sellers, retailers, individuals,

schools, restaurants and universities. It is estimated that between 2022 and 2030, the market will

be growing by 5% each year. Our success factor is to provide quality, timely and reliable

services to clients at reasonable prices. To finance its operation, Nafaka Linker Shop has about

Tshs 3,000,000 at hand and needs Tshs 4,000,000 loans. These funds will be used to cover up
expenses for all activities for the first six month of operation. In first three years of operation we

expect revenues of Tshs 56,400,000, Tshs 59,220,000 and Tshs 62,181,000 consecutively.
 SECTION ONE

TITLE OF THE BUSINESS

The business will deals with the selling and distribution of cereal products especially maize and

rice in Dar es salaam.

1.0 NAME OF THE BUSINESS

The name of this business is known as “Nafaka Linker Shop”. This name carries the whole

purposes of this business existence as a connecter between the customers and their needs of

cereal products from farmers to final consumers through selling them at affordable prices,

that is why it called nafaka linker.

1.1 OWNERS OF THE BUSINESS

The owners of the business (Nafaka Linker Shop) are David Motta, Veronica Magunga, Irene

Kumkwawa, Frank Mbuna, and Jaylene Kaimukilwa. They are both third year students at

Institute of Finance Management (IFM) Dar es salaam.

1.2 CONTACT DETAILS

Addresses: Kigamboni, Dar es salaam

Phone: 0628370090

0744305641

Email: linkershop255@gmail.com
 SECTION TWO

BACKGROUND

2.0 MISSION

The mission statement of this business is “To offer the society with high quality”

2.1 VISION

To become among the leading suppliers of cereals in Tanzania by 2030.

2.2 GOALS

To reach every house hold in Dar es salaam and in other regions in Tanzania for the future year

and to provide quality product at a competitive price.

2.3 BUSINESS DESCRIPTION

Our business is called Nafaka linker shop, it is a new business dealing with purchasing of

grains maize and rice during harvesting seasons due to low price of grains in that period,

assemble, processs them and pack ready for distribution. And that is what differentiate us from

others in this line of business, as most of them do not process or distribute and they just buy from

other distributers and sell them to retailers. We will purchase the grains directly from the

farmers, process them, package and distribute to our buyers. Our target market is Dar es salaam

city which is greater opportunity for market of our final products, the production center is

Morogoro and Mbeya due to the availability of raw materials for production of the final

products.

2.4 INDUSTRY ANALYSIS

The industry that the proposed business idea is going to operate is food industry, especially

maize and rice; the size of this industry in Dar es salaam is generally large, where there has been

an large number of university and college students who are our targeted customers.

 Business environment analysis

This involves the SWOT analysis which takes the key strengths and weaknesses within the

company, and details the opportunities and threats we will be facing from the external

environment, which would provide management with a framework for reviewing the strategy,

position, and direction of the business.

Strengths

We supply whole meal flour making us unique from other suppliers such as Bakhresa who

supply only white flour, thus giving us a competitive advantage. Management of our business is

simple and less complicated so it will restrict conflict of interest among owners and their workers

to the minimum level.

Challenges

We are a newly entrant in the food industry thus we face a huge competition from those already

existing in the industry, thus it will be difficult for us to win the market at the beginning. Low

capital we have leads to failure to reach economies of scale which make cost prices to be higher

than that charged to those who have large financial foundation.

Opportunities

High availability of local farmers that will supply us with the necessary inputs for our business

thus enabling us to have a constant supply of our products. Favourable transport, as our country
state of infrastructure being good in most regions including Mbeya and Morogoro which our raw

materials for production of final product in rice because the climate of Dar es salaam do not

support crop productions at a large quantities, also Dar es salaam has the large population which

demand such products that we produce and sell.

Processing cost and operating costs are low, as we get in to the contact to lease stores, office and

machines the costs of buying the new machine and building our stores and offices are reduced

easily. Dar es salaam and mbeya are connected with road network and also the availability of

railway transport facilities transportation of grains from Morogoro to Dar es salaam at low costs.

2.5 COMPETITION ANALYSIS

Our main competitor is Bakhresa and other suppliers. The main strength that they have is that

they already dominate the market for a long time and have an established well known brand and

their weakness is that they only offer white flour and not whole meal flour that is recently of

higher demand. This will give us the opportunity to quickly gain the market.
 SECTION THREE

MARKETING

3.0 MARKETING RESEARCH

Due to the processing, packaging and distribution of Maize and Rice shows the opportunities

which will make our business to gain more than 85% trust from intended customers. Some of

those opportunities include availability of raw materials at a low cost, availability of many

local farmers in nearby regions where we make production of our products thus, will make

our company to acquire the raw materials directly from farmers at a low cost.

Also there is favourable transport, most of the regions including Morogoro and Mbeya where

our raw materials available for production of final products are connected to our targeted area

which is Dar es salaam through railway and roads.

Availability of ready market, Dar es salaam region has high demand for maize flour and rice

because the climate and nature of dar es salaam city does not support crop productions to

large quantities. The demand for Dona now days is high compare to Sembe, hence most of

companies produce Sembe not Dona.

Not only the opportunities but also there are challenges in food industry, some of them are,

availability of big competitors with high experience and huge capital, this industry comprises

of different producers and suppliers of food products, example Bakhresa. Other is fluctuation

of products price, the prices of food products do fluctuate from time to time as the result of

fall in production of crops due to changes in climate conditions. Many crops cultivators do

depend more on rainfall and small number of them depend on irrigation.

3.1 MARKET ANALYSIS

Now days there are growing businesses in food products. Our business also is among these

businesses. Based on the reality that the market is growing rapidly thus it creates favourable

environment for attainment of the stated goals of our business.

Market growth; the market is growing as the increase in the number of people who consume the

products increases. For example in 2009- 2010 the production of milled rice was 1353714 tones

while in 2010- 2011 the production was 1423236 tones. This is equivalent to the growth of 5.1%

Market size; as the growing from time to time, we are in the position to acquire more than 25%

of the available market. The growth of food market we are in a good position to satisfy our

customers as we produce the unique product called whole meal flour and distribute it in larger

quantities.

Market demands; the demand for our products is huge due to the fact that these are products

which are consumed daily by everyone in the society as a basic need. Customers are in need to

have maize flour with all its nutrients, our product, that is whole meal flour contains all these

nutrients as opposed to white flour in which some of contents in the maize are removed through

milling. The nutrients are very important and for healthy purposes the whole meal flour is

recommended to be used.

3.2 MARKETING PLAN

The general marketing strategy will be to create the image of the highest quality services on

distribution of soft drinks in Dar es salaam city. The business will be located along one way

street which is the most crowded area of the township, also customers will be reached through

advertisement on social media, mass media as radio, fliers, and through its grand opening

ceremonies.
Not only that but also the targeted market of our business is the “people with low income” to be

able to buy our products based on their income levels even if all kind of customers will be able to

afford our products. Therefore, our company will produce the products which will be affordable

to all level of incomes, even if the most targeted are people with low income.

Also the company will use railway as transport means to transport raw materials from farmers to

production, processing and packaging area (morogoro and mbeya) as well as we shall use two

cars for distribution of our products from production areas to customers.

The price of our product will be achievable to all customers, this is because we shall package

them at different quantities with different prices, thus there will be 1kg up to 25kg bags of maize

flour and rice where by each bag will sold at different price due to the different quantity. There

we shall impose price on our products according to the current market price.

3.3 EVALUATION OF MARKETING

This is a research of a marketplace aimed at determining whether a new business can perform

well and succeed in a new business environment. Thus, from our business we have been

evaluating marketing and realised that Dar es salaam is good place for selling our products due to

high population of the people, also it is a business city where there is fast money circulation.
 SECTION FOUR

OPERATIONS AND PRODUCTION

4.0 LEGAL AND LICENCING REQUIREMENTS
For the establishment of our business, there are some requirements which we must fulfil in
before starting the business, those requirements are business licence by paying licence fee to
the Government for conducting business and business registration to Tanzania Revenue
Authority (TRA) for tax assessment and provision of Taxpayer Identification Number (TIN).
But also we are required to have permit from Tanzania Food and Drugs Authority (TFDA) as
well as permit from Tanzania Bureau of Standards ( TBS).

4.1 ORGANIZATION STRUCTURE AND MANAGEMENT PLAN

In partnership of the business, several individual with certain qualifications that suit the
business shall be employed to take responsibilities in the hierarchical manner. Those in the
top position will guide and control those below them in operating the business.

Partnership structure style as shown in the chart below

GENERAL PARTNER

Deputy General

Marketing Manager

Processing and Sales and distribution

Packaging Department
Department
Cashier
 4.2
MANAGEMENT PLAN
The business general partner shall perform the following duties
 Making decisions
 Making policies
 Planning
 Directing and controlling business operations
 Determine salaries
 Employing, recruiting and demoting employees.
4.3 PERSONNEL NUMBER AND DUTIES
The business at start-up will have five personnel through it expects to employ more as the
business grows to diversity. The qualifications of those personnel are as shown in the
partnership chart below

S/no Personnel Number Qualification Duties and

Responsibility
1 General partner 1 Degree in HRM Job description
2 Deputy General 1 Has Managerial Evaluating and
Partner Skills interviewing
employees chek
on the business
shortcomings
3 Marketing 1 Degree in sales Promotion tools
Manager & Marketing and coordinating
4 Cashier 1 Degree in Receiving
Accountant payment on
behalf of the
business,
controlling credit
and keeping
 business
documents
5 Processing and 2 Standard 7 Processing maize
packaging and rice and
pack it in bags
6 Distributor 1 Certificate in Distribute the
Procurement and final products in
Logistic target area Dar
Management es salaam
7 Watchman 1 Masai by tribe Protecting
faithful and business
energetic premises both at
day and night

4.4 DESCRIPTION OF THE PRODUCTS AND SERVICE PRODUCTION

We are dealing with the maize and rice processing, packaging and distribution.
Maize and rice are the main food crop in Tanzania and maize is grown all over the country
especially in Iringa, Mbeya, Ruvuma, Rukwa, Kilimanjaro, Morogoro, and Kagera. For rice
is grown mostly in Mbeya, Mwanza, Shinyanga and Kilimanjaro (lower moshi). Maize and
rice production has been increasing from year to year due to priority has been provided by
the government.

4.5 USES OF THE PRODUCTS

Rice and maize, they are demanded mostly for food consumption in different household
Maize and rice can be milling into flour and placed to satisfy the customer demand for food
consumption.
4.6 NEW PRODUCT TO BE INTRODUCED

Due to increase of population leads to high demand of food, therefore after expanding inour

business will increase to supply other grains such as beans, millet and so on, so as to be more

competitive and to meet our customer demand.

4.7 PRODUCT SIZE

We shall offer our product in different size based on our customer preferences. For whole

meal flour the size offered will be of 1kg, 5kgs, 10kgs and 25kgs. For rice the sizes offered

will be 1kg, 5kgs, 10kgs and 25kgs. This will be able to meet the demand of customers of

different income levels.

4.8 MODIFICATION OF THE PRODUCT TO AVOID FUTURE LOSS

We put our product in strong packages so as to avoid destruction from wet in the store. We

keep them in special designed stores and checking the stores in regular intervals to ensure

safe of the product.

Also we shall process that crops maize into flour and peeling both rice and maize to avoid

easy destruction and giving consumers’ access to wider choice of products and wider choice

of vitamin and minerals. Through it, will reduce postharvest losses and it will be easy for

transportation and distribution activities.

4.9 PRODUCT AND SERVICE BENEFIT

The customer will gain necessary nutrients available in maize and rice and they will enjoy

products of high quality that will not decay for reasonable period of time.
4.10 PRODUCT QUANTITY AND PRICE

The table below shows prices of various sizes of the products we will offer to our customers.

ITEM QUANTITY SELLING PRICE (TSHS)

Whole meal flour 1kg 1500
5kgs 7500
10kgs 15000
25kgs 37500
Rice 1kg 2000
5kgs 10000

4.11 PROMOTION STRATEGIES

Nafaka Linker shop will promote and create awareness on its products to customers by:
fliers’ distribution to customers five miles radius around our business location Nafaka Linker
Shop will offer discount to those purchasing in bulk. Promoting products at an introductory
price at its grand opening will be applied.
Pricing strategies; the pricing method will base on the cost incurred in production and
competitor’s price so as to enable to come up with ways to win the market through price and
assist us to not set prices above other suppliers as it will chase away the customers.
Placing Strategies; The business will be located at Kigamboni Market in Dar es salaam, this
is a place that is well known in Dar es salaam for various food products and other household
needs and there is availability of public transport making it easy to reach the place. We will
lease a warehouse that will help us have a constant supply and quick delivery of our
products.
4.12 PRODUCT STRATEGIES
Since cereals are not perishable, any channel of distribution can used to distribute goods. The
business shall use a direct channel of distribution which will be very short and no middlemen
will be involved.

4.13 MANUFACTURING AND OPERATIONAL PLAN

At the start up, the business shall operate with the local available machine and technologies
which is available at Kyela near the farms. These technologies will be cheap to lease at low
cost because the store for preserving the processed and packaging product is near the farms.
This will be the bases for advanced technology. The following equipment and stationeries
shall be used for running the business;

S/N EQUIPMENT QUANTITY SUPPLIER COST USE

1 Beam balance
2 Store and
office (rent)
per month
3 Furniture
Cabinets 1 100,000
Tables 2 20,000 For office
use
4 Stationary Gentro sup
Files 4 5,000 Keeping
records
Receipts 2 2,000 Showing
purchase
Biro pen 1pkt 5,000 Doing
calculations
Calculators 2 20,000 Writing
Bags 200pkt 100,000 Packing
5 Electricity and 500,000 Processing
water
TOTAL 1,532,000

4.14 HUMAN RESOURCES

Labor; the business will have a capacity of 8% at the start up. They would require Tsh
700,000 per month of work hours but we partners we will share profit equally per monthly.
They will be providing both skilled and unskilled labor. They will also have the following
skills;
 Technical skill. This will help them ti have knowledge of the product and is
maintenance.
 Entrepreneurial skill in order to evaluate risk and be able to generate ideas
 Managerial skill in order to control business resources for example machine, money
and other materials.
 Communication skill in order to transfer information in a networking area.

Unskilled labors will be used for loading and unloading bags, cleaning stores and
business premises. The worker will be motivated through being paid on time as well as
overtime hours.

(a) Materials
This will include stock which includes processed maize and processed rice. These
must be stored in a leak proof roof, with ventilated and drained room to avoid
rotting and destruction by rodents, for example rats and mice.

(b)Premises
 The business will operate in Dar es salaam at Kigamboni market. Business
premises measure 10 meters wide and 12 meters length. The rooms will be
divided into three parts which are reception room, office room and main store
(Grain store)

(c) Technology
At start up the business will use the cheapest and most available technology that is
calculator for making work easier other than use of pen and paper. As business
growth, a computer will be bought so that all transactions are entered for
references.

4.15 PRODUCTION STRATEGY

Nafaka Linker Shop shall use production techniques to develop products finishing
and packaging products. It will then finally estimate distributing costs, putting
into mind “customer care” and the attributes preferred of the products by the
customer.
The business will follow the criteria as follow below
 Determining the product market within which a market search will be
conducted
 Determine the importance of the product in the area
 Presenting those attributes in a configuration perceived by the customer
 Developing a model relating to customer’s preferences and tastes. This
developing will be done by different personnel in different hours using
different equipment in order suit the market.

4.16 PRODUCTION RISKS

Drought; maize and rice always grow well in areas where there is enough rainfall, during
drought season the farmers not get enough products, thus it is the big problem in our
business. These results into the shortage of products rise in price as a result our business can
enter in bad condition.
Risk from unpredictable or insufficient rain are the persistence challenge for Tanzania
agriculture sometimes rainfall may too late for maize and rice season can cause shortage of
product which result in difficult in our business.

Pest and diseases; in the warehouse the maize can be affected by different pests and other
harmful insects, due to this problem the customers can delay in buying our products or they
buy it at low cost due to the costs which will be included in further processing which is loss
to our business.

Bush fire and birds;

Bush fires are wild or uncontrolled fires that destroy rice farms and lead to low output and
reduce soil fertility. Birds are flying creatures that destroy rice or grains and cause low output
also they destructed seed after planting.

4.17 MARKETING RISKS AND OTHER RISKS

Price risk and post harvesting losses; lack of guaranteed demand will make it difficult to plan
for the future, the risk of selling our crops at low price during high season and volatility in
supply and demand is risk for our business which can lead to profit losses.

Threat of new entry is a high risk in the market; cereals market being steadily growing,
attract a lot of investors, which in turn leads to high competition and decline in market share
that we might have achieved. High barrier to entry the most successful cereals suppliers are
aggressively expanding their distribution channels and consolidating the independent
locations and distribution centers.

Capital requirements are too high and distribution systems are extensive and necessary to
compete with the market leaders who have economies of scale and financial muscles. High
cost in promotional activities, printing the files and consulting some mass media for
advertising our services is very cost full.
 SECTION FIVE

FINANCIAL PROJECTIONS
5.0 INCOME AND EXPENSES
We expect to mobilize our funds from personal sources, that is, contribution from each
partner, contribution from family and friends and loan from NMB bank. The total capital for
starting the business is Tshs 7000,000/= , this amount is distributed in the following ways

DETAILS AMOUNTS PERCENTAGE

Members contribution @ (350,000 * 5) 1750000 25%
Loan from NMB bank 4,000,000 57.143%
Parents assistance @ (250,000 * 5) 1250000 17.857%
TOTAL AMOUNT 7000,000 100%
5.1 FINANCIAL FORECASTS
Nafaka Linker Shop projected income statement

2022 2023 2024

Sales 56,400,000 59,220,000 62,181,000
LESS: cost of goods
sold
Opening stock - 2,600,000 2,730,000
Purchases 13,000,000 13,650,000 14,332,500
Cost of goods 13,000,000 16,250,000 17062500
available for sale
LESS: closing stock 2,600,000 1,230,000 1,010,000
Cost of goods sold 10,400,000 16,250,000 17,062,500
Gross profit 46,000,000 15,020,000 16,052,500
LESS: expenses
Transportation cost 2,000,000 2,100,000 2,205,000
Rent 6,000.000 6,300,000 6,615,000
Electricity and water 1,000,000 1,050,000 1,102,500
Packaging and 5,000,000 5,250,000 5,512,500
processing
Wages 2,000,000 2,100,000 2,205,000
NET PROFIT 30,000,000 31,500,000 33,075,000

The projected sales and profit may change due to various risks that may affect our
productions, thus making projected output less than expected.
 SECTION SIX
IMPLEMENTATION PLANNING SCHEDULE
Time in month (2022)

Activities
July August September October December
Registration
to
regularities
(TRA),
(TFDA),
(TBS)
Start up of
the business
Processing
and
packaging
Promotion
activities
Distribution
activities
 SECTION SEVEN
APPENDICE

TRA- Tanzania Revenue Authority

TFDA- Tanzania Food and Drugs Authority

TBS- Tanzania Bureau of Standards

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